Retail trader data shows 72.4% of traders are net-long
GBP/USD: Retail trader data shows 72.4% of traders are net-long with the ratio of traders long to short at 2.62 to 1. In fact, traders have remained net-long since May 06 when GBPUSD traded near 1.29202; price has moved 2.2% lower since then. The number of traders net-long is 6.1% higher than yesterday and 10.1% higher from last week, while the number of traders net-short is 1.8% higher than yesterday and 3.7% higher from last week.
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GBP/USD: Increase in net-longs suggests bearish trading bias
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests GBP/USD prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger GBP/USD bearish contrarian trading bias.
-Written by Tammy Da Costa, DailyFX Research